Speech to Parliament by Libby Coker MP on 7th September 2022:
Australia now has a government that gets climate change and understands the steps needed to reduce carbon emissions. After a decade of denial and delay from the previous government, we now have the opportunity to give Australians access to the world's best low-emissions car technology. This is especially important because passenger cars create almost 10 per cent of Australia's CO2 emissions. Serious action on climate must involve serious action on transport emissions. That's why the Albanese government is putting in place the steps to establish Australia's first National Electric Vehicle Strategy. The focus of the strategy will be on improving the uptake of electric vehicles and improving affordability and choice by growing the Australian electric vehicle market.
It's clear that Australians want to move towards cleaner car technologies like electric vehicles. Australia is a nation with a reputation for embracing new ideas and new technologies. After all, Australians led the world in the take-up of mobile phones, ATMs, electronic online banking and a range of other technologies. And we know that Australians care about the impact of climate change and want to play their part in reducing carbon emissions.
As I drive around my electorate of Corangamite, I see an increasing number of people making the change to electric or plug-in hybrid vehicles. It's no longer an oddity to see an electric car sitting in a driveway or pulling up beside you at the traffic lights. Despite a very unfriendly policy setting under the previous government, Australians have managed to edge up electric vehicle and plug-in car sales. They are now two per cent of total car sales, off an appalling base of 0.7 per cent in 2019. While this is a small step forward, it isn't enough. Despite a willingness to embrace new technologies, cost and affordability are holding us back. The cost and limited range of available electric cars in Australia excludes many from giving up their petrol or diesel vehicle.
Australia is significantly behind much of the world when it comes to electric vehicles. I learned recently that, in the United Kingdom, people could choose from 26 low-emission vehicles under the equivalent price of A$60,000. By comparison, in Australia there are fewer than 10 such vehicle options. At just two per cent, our uptake of new low-emission vehicles is nearly five times lower than the international average. In the UK, for instance, electric and plug-in hybrids make up about 15 per cent of cars sold. Australians can't afford to continue to be left behind. Australians don't want to be left behind. Australians are experiencing significant cost-of-living challenges right now, and giving Australians better fuel options for their vehicles is one means of easing those cost challenges.
In 2019 the Australian Electric Vehicle Association estimated there would be, on average, annual savings of $500 in fuel and $100 in maintenance costs for every electric vehicle in the national fleet. Respected UBS estimates projected consumer savings of $1,700 per annum by 2030 on the total cost of ownership of an electric vehicle compared to combustion engine vehicles. The arguments for electric vehicles are strong and well established.
Unfortunately, unaffordability and unavailability issues within the Australian electric vehicle market are, in large part, a direct result of policy decisions of the government—or, more correctly, policy failures by the previous government. The intent of the electric car policy in Australia up until now appears to have been aimed at limiting the availability of electric cars and making them more expensive—a short-sighted approach that lacked logic. Who can remember the ridiculous comments made by the previous government around EVs destroying the tradies' weekends? They wouldn't be able to afford their utes anymore! To me, this should ultimately be a matter of choice—freedom of choice. Policy settings under the previous government were denying Australians real choice for good, affordable, no-emission cars. When asked, more than one in two Australians say they would consider buying an electric vehicle for the next car.
The previous government's policy settings mean we are now behind the pack. Australians are missing out, and without strong federal leadership we will continue to miss out. The Albanese government will provide that necessary leadership. We know from overseas experience that with the right policy settings electric vehicle penetration can increase quickly. Sweden, for example, increased its proportion of EV sales from 18 per cent to 62 per cent in just two years. We know from overseas that once you get to five per cent sales EV penetration in the market can increase rapidly as critical mass is reached. We as a government and as a nation have a lot of work to do to catch up to the world.
The Albanese government is bringing back leadership that has long been lacking. We went to the election with a clear agenda across the board for tackling climate change, including with electric vehicles. The government's Driving the Nation plan will establish a truly national electric-vehicle charging network, with charging stations at an average interval of 150 kilometres on major roads. It will create a national hydrogen highway refuelling network and it will set a low-emissions vehicle target for the Commonwealth fleet of 75 per cent new leases and purchases by 2025. With thousands of vehicles in the Commonwealth fleet, it is big enough to encourage more EV modelling introductions to Australia and will expand a resale market.
We're acting to make electric vehicles cheaper through the removal of the fringe benefits tax and the five per cent import tariff for eligible electric cars. This is significant. Effectively, there will be an electric car discount in the form of a fringe benefits tax exemption. The fringe benefits tax changes mean a vehicle model with a price tag of around $50,000 will be up to $4,700 a year cheaper for someone using a salary sacrifice arrangement. That is an appealing offer—$4,700 a year cheaper for someone. An employer paying for the same model could save up to $9,000 a year. These incentives are critical for fleet buyers and, in turn, the second-hand market.
We also believe we can and should have not only the ability to drive electric vehicles but also the capacity to produce them. Up to $3 billion of the $15 billion National Reconstruction Fund will be put towards activities including clean-energy component manufacturing. There is great potential for the electric vehicle industry to be actively pursuing opportunities for co-investment from that fund.
Those opportunities are particularly relevant to my electorate of Corangamite and the broader Geelong region, which has a proud history in vehicle and high-tech vehicle componentry manufacturing. Manufacturers in my area are already considering the possibilities that will emerge in electric vehicle component manufacturing. They're coming to me and asking me about this fund. They want to be a part of it, and I'm going to encourage them, under the National Reconstruction Fund, to get involved. There will be no shortage of opportunities and activities in regard to electric vehicles under an Albanese Labor government. The key to linking all of this activity together is an overarching strategy, which is why our government is committed to the development of Australia's first National Electric Vehicle Strategy.
The government's objectives in relation to electric vehicles are clear. We are moving to make electric vehicles more affordable, drive more choice in the market, drive electric vehicle uptake and reduce emissions. Other benefits will include savings on fuel for car owners and potential local manufacturing opportunities. The Electric Vehicle Strategy will be our road map to become a leader in reducing emissions from car transportation. If Australia doesn't show leadership through a strategy of this type, international manufacturers will prioritise other markets.
We know many of the challenges. They include lack of charging infrastructure, limited range, high costs, long waiting times and lack of availability. These are big challenges. While the solution to each challenge is different, the solutions ultimately will come back to one thing: strong, decisive policy leadership from government—leadership the Albanese government will provide.
The bill before us today is part of that leadership Australians have been looking for on climate action. We will provide that leadership in a way which brings Australians together on the journey. Our Driving the Nation policy for a fast charger every 150 kilometres, for example, is designed to ensure Australians in rural and remote communities like my electorate of Corangamite will have real choice when it comes to their next car purchase. Electric vehicles are not and cannot be the preserve of the well-off and urban dwellers. We are implementing policy settings that make electric vehicles affordable and attractive to all. This bill is important. It will be an important catalyst for reducing carbon emissions through the increased uptake of electric vehicles.
